Nova Announces 2015 Full-Year Results

REHOVOT, Israel, Feb. 17, 2016 /PRNewswire/ -- Nova Measuring Instruments (Nasdaq: NVMI), a leading innovator and a key provider of metrology solutions for advanced process control used in semiconductor manufacturing, today reported record 2015 full-year results. The company closed the acquisition of ReVera on April 2, 2015. Accordingly, the company's fourth quarter and annual results include the contribution of ReVera, with no similar contribution in some of the previous periods.

Fourth Quarter 2015 Highlights:

• Revenues of $40.0 million, at the high end of the guidance ($37-$41 million)
• Non-GAAP net income of $5.3 million, or $0.19 per diluted share, at the high end of guidance ($0.11-$0.20 per diluted share)
• Diversified customer mix yielded four customers contributing more than 10% each to the quarterly revenues, including one leading memory customer
• Selected by the world's leading foundry to deliver Optical and X-ray metrology solutions for multiple process steps at 10/7/5nm technology nodes

Full Year 2015 Highlights:

• Record full-year revenues of $148.5 million
• Non-GAAP net income of $21.0 million, or $0.76 per diluted share
• Five customers contributed 10% or more to annual product revenues, compared to only two in 2014 
• Product revenues from the Memory segment grew to 30% of annual product revenues, compared to only 15% in 2014
• Growing customers' adoption of Nova's software solutions generated 104% increase in annual software revenues
• Creating a unique offering with the successful integration of ReVera

A reconciliation between GAAP operating results and non-GAAP operating results is provided following the financial statements that are part of this release. Non-GAAP results exclude amortization of acquired intangible assets, deferred tax assets adjustments (net), stock-based compensation expenses and acquisition related expenses.

Management Comments

"The fourth quarter results represent a strong finish to a record year, with revenues and net income at the high end of our guidance," commented Eitan Oppenhaim, President and Chief Executive Officer of Nova. "Our annual achievements demonstrate once again our ability to execute upon our strategic initiatives, while improving our products and customers diversification and maintaining a solid operational model. Today, Nova's industry leading position is supported by a growing base of customers that are embracing our ability to deliver best-in-class optical and x-ray suit of products, augmented by advanced software and modeling solutions. With these solid results, we are well positioned to win more opportunities in the market, setting the stage for Nova's continued growth in the coming years."

2016 First Quarter Financial Outlook

Management provided an outlook for the first quarter, the period ending March 31, 2016.

Based on current estimates, management expects:

• $33 million to $37 million in revenue
• $0.10 to $0.17 in diluted non-GAAP EPS
• $0.06 to $0.11 in diluted GAAP EPS

2015 Fourth Quarter Results

Total revenues for the fourth quarter of 2015 were $40.0 million, decrease of 1% compared to the third quarter of 2015, and an increase of 55% relative to the fourth quarter of 2014.

Gross margin for the fourth quarter of 2015 was 52%, and included $1.1 million of amortization of acquired intangible assets in cost of product. This is compared with 56% in the third quarter of 2015 and compared with 52% in the fourth quarter of 2014.

Operating expenses in the fourth quarter of 2015 were $17.3 million, and included $0.4 million of amortization of acquired intangible assets. This is compared with $17.4 million in the third quarter of 2015 and compared to $11.9 million in the fourth quarter of 2014.

On a GAAP basis, the company reported net income of $5.2 million, or $0.19 per diluted share, in the fourth quarter of 2015. This is compared with net income of $5.4 million, or $0.20 per diluted share, in the third quarter of 2015. The company reported net income of $3.3 million, or $0.12 per diluted share, in the fourth quarter of 2014.

On a Non-GAAP basis, which excludes amortization of acquired intangible assets, adjustments of deferred tax assets and stock-based compensation expenses, the company reported net income of $5.3 million, or $0.19 per diluted share, in the fourth quarter of 2015. This is compared net income of $6.3 million, or $0.23 per diluted share, in the third quarter of 2015 and to net income of $2.3 million, or $0.08 per diluted share, in the fourth quarter of 2014.

2015 Full Year Results

Total revenues for 2015 were $148.5 million, an increase of 23% compared to total revenues of $120.6 million for 2014.

Gross margin in 2015 was 52%, and included $3.5 million of amortization of acquired intangible assets in cost of product. This is compared with gross margin of 53% in 2014.

Operating expenses in 2015 were $65.5 million, and included $2.7 million of acquisition related expenses and $1.5 million of amortization of acquired intangible assets. This is compared with operating expenses of $46.7 in 2014.

On a GAAP basis, the company reported net income of $15.7 million, or $0.57 per diluted share, in 2015. This is compared with net income of $18.7 million, or $0.67 per diluted share, in 2014.

On a Non-GAAP basis, which excludes amortization of acquired intangible assets, adjustments of deferred tax assets, stock-based compensation expenses and acquisition related expenses, the company reported net income of $21.0 million, or $0.76 per diluted share, in 2015. This is compared with net income of $19.2 million, or $0.69 per diluted share, in 2014.

Total cash reserves at the end of 2015 were $97.8 million, compared to $123.7 million at the end of 2014.

Conference Call Information

Nova will host a conference call on Wednesday, February 17, 2016 at 4:30 p.m. Eastern Time, to discuss the fourth quarter results and future outlook.

To attend the conference call, please dial one of the following teleconferencing numbers. Please begin by placing your calls 5 minutes before the conference call commences. If you are unable to connect using the toll-free numbers, please try the international dial-in number.

U.S. Dial-in Number:  1-888-401-4668
ISRAEL Dial-in Number:  1 80 924 5906
INTERNATIONAL Dial-in Number:  1-719-457-2083

At:

4:30 p.m. Eastern Time
1:30 p.m. Pacific Time
11:30 p.m. Israeli Time

Please reference conference ID 2897451

The conference call will also be webcast live from a link on Nova's website at http://ir.novameasuring.com. For those unable to participate in the conference call, there will be a replay available from a link on Nova's website at http://ir.novameasuring.com.

About Nova: Nova Measuring Instruments Ltd. delivers continuous innovation by providing advanced metrology solutions for the semiconductor manufacturing industry. Deployed with the world's largest integrated-circuit manufacturers, Nova's products deliver state-of-the-art, high-performance metrology solutions for effective process control throughout the semiconductor fabrication lifecycle. Nova's product portfolio, which combines high-precision hardware and cutting-edge software, supports the development and production of the most advanced devices in today's high-end semiconductor market. Nova's technical innovation and market leadership enable customers to improve process performance, enhance products' yields and accelerate time to market. Nova acts as a partner to semiconductor manufacturers from its offices around the world. Additional information may be found at www.novameasuring.com.

Nova is traded on the NASDAQ & TASE under the symbol NVMI.

This press release provides financial measures that exclude non-cash charges for amortization of acquired intangible assets, deferred tax assets adjustments (net), stock-based compensation expenses and acquisition related expenses and are therefore not calculated in accordance with generally accepted accounting principles (GAAP). Management believes that these non-GAAP financial measures provide meaningful supplemental information regarding Nova's performance because they reflect our operational results and enhances management's and investors' ability to evaluate Nova's performance before charges or benefits considered by management to be outside Nova's ongoing operating results. The presentation of this non-GAAP financial information is not intended to be considered in isolation or as a substitute for the financial information prepared and presented in accordance with GAAP. Management believes that it is in the best interest of its investors to provide financial information that will facilitate comparison of both historical and future results and allows greater transparency to supplemental information used by management in its financial and operational decision making. A reconciliation of each GAAP to non-GAAP financial measure discussed in this press release is contained in the accompanying financial tables.

This press release contains forward-looking statements within the meaning of safe harbor provisions of the Private Securities Litigation Reform Act of 1995 relating to future events or our future performance, such as statements regarding, but are not limited to, anticipated growth opportunities and projections about our business and its future revenues, expenses and profitability. Forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause our actual results, levels of activity, performance or achievements to be materially different from any future results, levels of activity, performance or achievements expressed or implied in those forward looking statements. Factors that may affect our results, performance, circumstances or achievements include, but are not limited to, the following: our dependency on three product lines; our dependency on a small number of large customers and small number of suppliers; the highly cyclical and competitive nature of the markets we target and we operate in; our inability to reduce spending during a slowdown in the semiconductor industry; our ability to respond effectively on a timely basis to rapid technological changes; our ability to recognize the benefits of ReVera acquisition and risks that the acquisition may disrupt current plans and operations and impact relationships with customers, distributors and suppliers; our dependency on PEMs; risks related to exclusivity obligations and non-limited liability that may be included in our commercial agreements and arrangements; our ability to retain our competitive position despite the ongoing consolidation in our industry; risks related to our dependence on our manufacturing facilities; risks related to changes in our order backlog; risks related to the worldwide financial instabilities; risks related to our intellectual property; new product offerings from our competitors; unanticipated manufacturing or supply problems; changes in tax requirements; changes in customer demand for our products; risks related to currency fluctuations, risks related to acquisitions we may pursue and risks related to our operations in Israel. We cannot guarantee future results, levels of activity, performance or achievements. The matters discussed in this press release also involve risks and uncertainties summarized under the heading "Risk Factors" in Nova's Annual Report on Form 20-F for the year ended December 31, 2014 filed with the Securities and Exchange Commission on February 25, 2015. These factors are updated from time to time through the filing of reports and registration statements with the Securities and Exchange Commission. Nova Measuring Instruments Ltd. does not assume any obligation to update the forward-looking information contained in this press release.

SOURCE Nova Measuring Instruments Ltd.

Related Links

http://www.novameasuring.com